EXHIBIT 2.1(C)
SECOND AMENDMENT TO MERGER AGREEMENT
THIS SECOND AMENDMENT TO MERGER AGREEMENT (the "Amendment") is executed
effective as of the ____ day of November, 1999, by and among INNOVATIVE VALVE
TECHNOLOGIES, INC., a Delaware corporation ("Invatec"), PLANT MAINTENANCE, INC.,
a Delaware corporation ("PMI-Delaware") and successor-by-merger to Plant
Acquisition, Inc. and Plant Maintenance, Inc., XXXXXXX X. XXXXXX, an individual
residing in Oklahoma, XXXXXXX X. XXXXXX, an individual residing in Oklahoma, and
XXXX X. XXXXXX, XX., an individual residing in Texas. Invatec, PMI-Delaware, Xx.
Xxxxxx, Xx. Xxxxxx and Xx. Xxxxxx are hereinafter sometimes referred to
collectively as the "Parties" and individually as a "Party." Except as otherwise
specifically indicated herein, all defined terms contained herein shall have the
same meanings as contained in that certain Merger Agreement (the "Original
Merger Agreement") dated effective June 29, 1998, executed by Invatec, Plant
Acquisition, Inc., Plant Maintenance, Inc., Xx. Xxxxxx, Xx. Xxxxxx and Xx.
Xxxxxx, as amended by that certain Amendment to Merger Agreement (the "First
Amendment") dated effective September 25, 1998, executed by the Parties (the
Original Merger Agreement, as amended by the First Amendment, is hereinafter
referred to as the "Merger Agreement").
WHEREAS, Invatec has provided to Xx. Xxxxxx, Xx. Xxxxxx and Xx. Xxxxxx
(the "Former PMI Shareholders"), on a confidential basis pursuant to the
Confidentiality and Nondisclosure Agreement entered into as of October __, 1999,
(the "Confidentiality Agreement"), information regarding one or more
possibilities for a potential Restructuring (as defined in the Confidentiality
Agreement) and, in connection with a Restructuring, Invatec has requested that
the Former PMI Shareholders and certain other third parties (collectively, the
"Holders"), including certain former owners of companies acquired by Invatec,
and certain holders of debt or preferred stock issued by Invatec or its
subsidiaries, amend the terms of the obligations owed to such Holders (any
agreements entered into with any Holders, if any, being hereinafter referred to
collectively as the "Holders' Modification Agreements"), in order to allow
Invatec to pursue, discuss and negotiate a Restructuring and induce the
stockholders of Invatec to approve or otherwise participate in a Restructuring
and any other Restructuring approved by Invatec, and to enter into and
consummate any transactions which may arise therefrom or in connection therewith
(any such Restructuring and such transactions being hereinafter collectively
referred to as the "Transaction");
WHEREAS, the Former PMI Shareholders have agreed to modify the terms of
Invatec's obligations to them under the Merger Agreement on the terms
hereinafter set forth;
NOW, THEREFORE, for and in consideration of the premises, the mutual
covenants and agreements contained herein, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
Parties hereby agree as follows:
1. Paragraph 6(C) of the Merger Agreement is hereby deleted in its
entirety, and substituted therefor is the following:
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"(C) SHARES OF INVATEC COMMON STOCK NOT SOLD WITHIN TWELVE MONTHS.
If the Current Market Price as of the Subsequent Measurement Date is less
than the Agreed Closing Value of Invatec Stock, then Invatec will pay each
Stockholder for each share of Invatec Common Stock issued to such
Stockholder in the Acquisition (after giving effect to any adjustment
pursuant to PARAGRAPH 5) and still owned by such Stockholder as of the
Subsequent Measurement Date, (a) if such payment is made on or before
January 31, 2000, Four and 57/100 Dollars ($4.57), payable in cash, or (b)
if such payment is made after January 31, 2000, Six and 85/100 Dollars
($6.85), which payment may be made by Invatec, at Invatec's option, either
in cash or by issuing to each Stockholder Invatec Common Stock at a per
share price equal to the Current Market Price as of the Subsequent
Measurement Date.
The Current Market Price as of the Subsequent Measurement Date was less than the
Agreed Closing Value of Invatec Common Stock under the Agreement.
Notwithstanding any provision hereof to the contrary, if the tender offer price
on the date of commencement of the tender in the transaction currently
contemplated by Invatec is less than One and 68/100 Dollar ($1.68) per share,
then this Agreement shall terminate and be of no further force or effect upon
the expiration of five (5) business days after the commencement of the tender,
unless the Stockholders execute a written instrument waiving this termination
right within such five (5) business day period.
2. The Parties hereby acknowledge and agree that as of the Subsequent
Measurement Date, Xx. Xxxxxx owned Two Hundred Ten Thousand Eighty-Six (210,086)
shares of Invatec Common Stock issued to him in the Acquisition, and that upon
execution hereof he will be entitled to (a) Nine Hundred Sixty Thousand
Ninety-Three and 02/100 Dollars ($960,093.02), all of which is to be paid in
cash, if such payment is made on or before January 31, 2000, or (b) One Million
Four Hundred Thirty-Nine Thousand Eighty-Nine and 10/100 Dollars
($1,439,089.10), which payment may be made by Invatec, at Invatec's option,
either in cash or by issuing to each Stockholder Invatec Common Stock as
contemplated above, if such payment is made after January 31, 2000.
3. The Parties hereby acknowledge and agree that as of the Subsequent
Measurement Date, Xx. Xxxxxx owned Two Hundred Ten Thousand Eighty-Six (210,086)
shares of Invatec Common Stock issued to him in the Acquisition, and that upon
execution hereof he will be entitled to (a) Nine Hundred Sixty Thousand
Ninety-Three and 02/100 Dollars ($960,093.02), all of which is to be paid in
cash, if such payment is made on or before January 31, 2000, or (b) One Million
Four Hundred Thirty-Nine Thousand Eighty-Nine and 10/100 Dollars
($1,439,089.10), which payment may be made by Invatec, at Invatec's option,
either in cash or by issuing to each Stockholder Invatec Common Stock as
contemplated above, if such payment is made after January 31, 2000.
4. The Parties hereby acknowledge and agree that as of the Subsequent
Measurement Date, Xx. Xxxxxx owned Eighty Thousand Thirty-Two (80,032) shares of
Invatec Common Stock issued to him in the Acquisition, and that upon execution
hereof he will be entitled to (a) Three Hundred Sixty-Five Thousand Seven
Hundred Forty-Six and 24/100 Dollars ($365,746.24), all of which is to be paid
in cash, if such payment is made on or before January 31, 2000, or (b) Five
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Hundred Forty-Eight Thousand Two Hundred Nineteen and 20/100 Dollars
($548,219.20), which payment may be made by Invatec, at Invatec's option, either
in cash or by issuing to each Stockholder Invatec Common Stock as contemplated
above, if such payment is made after January 31, 2000.
5. In the event the payments provided for in subparagraph (b) of Sections
2, 3 and 4 hereof are made in shares of Invatec common stock, Invatec agrees to,
and to cause Xxxxx Xxxxxx Shareholder Services, L.L.C. as Rights Agent to, enter
into an amendment to the Rights Agreement dated as of September 18, 1997,
exempting from the provisions of that agreement the issuance of any shares of
Invatec common stock pursuant to subparagraph (b) of Sections 2, 3 and 4 hereof.
6. Each Party hereby agrees not to file any claim or cause of action
against any person or entity, whether or not a party to this Agreement, with
respect to the Merger Agreement or any of the transactions contemplated therein,
prior to January 31, 2000 (the "Standstill Expiration Date").
7. The Parties agree that any limitations periods for bringing a claim or
cause of action not already barred at the date of this Amendment but which would
expire before the Standstill Expiration Date, are hereby tolled and extended
through and including February 15, 2000. This Amendment shall not serve to
extend or in any manner affect limitations periods which would not otherwise
expire prior to the Standstill Expiration Date, nor shall it serve to revive any
claims or actions upon which limitations have expired at the date of this
Amendment. Each Party acknowledges and confirms that in no way shall the terms
and provisions hereof be, or be construed to be, an admission of any liability
of any Party to any other Party, or an acknowledgment of the validity of any
claim or potential claim of any other Party.
8. Effective upon receipt of the cash payments of $4.57 per share of
Invatec common stock on or before January 31, 2000, as contemplated in
subparagraph (a) of Sections 2, 3 and 4 hereof, to the maximum extent permitted
by applicable law, each of the Former PMI Shareholders releases and forever
discharges Invatec and its officers, directors, shareholders, employees, agents,
representatives and affiliates, and their respective heirs, administrators,
successors and assigns (individually a "Released Party" and collectively, the
"Released Parties"), from (i) any and all debts, liabilities, obligations,
claims, demands, actions or causes of action that arise out of or are based upon
any misrepresentation, omission, transaction, fact, event or other matter
related to, based upon or arising out of the Merger Agreement, as amended
hereby, this Amendment or any of the transactions contemplated herein or therein
(INCLUDING ANY ACT OR FAILURE TO ACT THAT CONSTITUTES ORDINARY OR GROSS
NEGLIGENCE OR RECKLESS OR WILLFUL, WANTON MISCONDUCT). If such cash payments are
not made on or before January 31, 2000, this release shall be void and of no
force or effect. Each of the Former PMI Shareholders (i) acknowledges that he
fully comprehends and understands all the terms of this release and its legal
effects, and (ii) expressly represents and warrants that (a) he is competent to
effect the release made herein knowingly and voluntarily and without reliance on
any statement or representation of any Released Party or any of their agents,
employees or representatives, and (b) he has had the opportunity to consult with
an attorney of his choice regarding this release and has done so.
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9. The Former PMI Shareholders understand that Invatec is subject to the
reporting requirements of Section 13 of the Securities Exchange Act of 0000 (xxx
"Xxxxxxxx Xxx"). The Former PMI Shareholders have been furnished a copy of
Invatec's Annual Report on Form 10-K for the fiscal year ended December 31, 1998
and its quarterly reports on Form 10-Q for the fiscal quarters ended March 31
and June 30, 1999 (collectively, the "Reports"). The Former PMI Shareholders
have (i) for a reasonable amount of time had an opportunity to ask questions and
receive answers concerning the Reports, Invatec and its business, the terms and
conditions of the Restructuring, this Agreement and the Holders' Modification
Agreements, and are satisfied with the results thereof, (ii) been given access,
if requested, to all other documents with respect to Invatec or the
Restructuring, as well as to such other information as the Former PMI
Shareholders have requested, and (iii) and relied solely on investigations
conducted by the Former PMI Shareholders in making the decision to execute an
deliver this Agreement.
10. All other terms, conditions and covenants contained in the Merger
Agreement shall remain in full force and effect except as expressly amended
herein. The Parties hereby authorize, adopt, ratify, confirm and approve the
Acquisition on the terms and conditions set forth in the Merger Agreement,
except as the same are expressly amended hereby. In addition, the Parties
acknowledge and agree that (a) the form, terms and provisions of any Transaction
may change, (b) such changes may be material, (c) any Transaction may be
abandoned for a different Restructuring, and (d) the obligations of each Party
hereunder shall remain in full force and effect with respect to such changed or
different Transaction, provided that under any different terms of the
Transaction, or any different Transaction or Restructuring, each Former PMI
Shareholder receives (or is entitled to receive, at such Former PMI
Shareholder's option) an aggregate of at least Six and 25/100 Dollars ($6.25)
for each share of Invatec Common Stock issued to him in the Acquisition, which
payment shall include full and final payment, compromise and settlement of the
obligations under Section Paragraph 6(C) of the Merger Agreement, and
consideration for the acquisition (in any form) of each such share.
11. Although Invatec agrees to pursue the execution and delivery of the
Holders' Modification Agreements by the other Holders, this Amendment shall be
binding upon, and inure to the benefit of, each of the Parties, and their
respective heirs, executors, administrators, successors and assigns, regardless
of whether any other Holder executes a Holders' Modification Agreement.
12. From time to time after the execution hereof, at the request of
Invatec or its successors or assigns, each other Party shall execute and deliver
such further documents and take such other and further actions as may be
reasonably requested by Invatec or its successors or assigns arising out of this
Amendment or any of the agreements or transactions contemplated herein.
13. Each of the undersigned representatives of each Party represents and
warrants that his signature constitutes the valid and binding act of such Party,
and that he has been duly authorized, empowered and directed to execute and
eliver this Amendment.
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14. The Merger Agreement, this Amendment, and the Confidentiality
Agreement embody the entire agreement and understanding among the Parties
relating to the subject matter hereof, and supersede all prior proposals,
negotiations, agreements, commitments and understandings relating to such
subject matter. There are no unwritten agreements among the Parties.
15. This Amendment may be executed simultaneously in a number of identical
counterparts, each of which shall be an original and all of which together shall
constitute but one and the same instrument. Facsimile signatures shall be
treated as original signatures for all purposes relating to this Amendment.
IN WITNESS WHEREOF, this Amendment has been executed and delivered to be
effective as of the date first set forth above.
INNOVATIVE VALVE
TECHNOLOGIES, INC.
By: /s/ XXXXXXX X. XXXXXXXX
Xxxxxxx X. Xxxxxxxx, President
PLANT MAINTENANCE, INC.
By: /s/ XXXXXXX X. XXXXXXXX
Xxxxxxx X. Xxxxxxxx, Vice President
XXXXXXX X. XXXXXX
XXXXXXX X. XXXXXX
XXXXXXX X. XXXXXX
XXXXXXX X. XXXXXX
XXXX X. XXXXXX, XX.
XXXX X. XXXXXX, XX.
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